The IAGS Journal of Energy Security (JES) relies solely on the generosity of our donors to be able to deliver information, research, insight and hard data on global energy security issues. Please consider donating to the Journal of Energy Security to strengthen, broaden and deepen our global coverage. IAGS is a publicly supported, nonprofit organization under section 501(c)3 of the Internal Revenue Code. All contributions are tax deductible to the full extent allowed by law. Click here to donate.

There is no lack of voices warning against the dangerous implications of the nuclear agreement the Obama Administration is advancing with Iran. The opposition has mostly focused on the destabilizing geopolitical impact of a nuclear Iran and what it means for the security of the U.S. and its allies. But there is one less obvious casualty – the North American oil and gas industry.

The Ukrainian government is threatening the future of its already struggling oil and gas sector by introducing new taxes. The royalty, which taxes output sales, together with the tax rates of 70% for state-owned production companies, 55% on wells under 5,000 meters depth, and 35% on wells over 5,000 meters will lead to a dramatic decrease in domestic production and increase Ukraine’s dependence on Russia. For Ukraine this is a question of survival as it cannot continue its dependence on Russian gas for geopolitical reasons and sending Western investors packing would be suicidal.

Over the past few years China has launched efforts to develop the world's first commercial thorium - fueled reactor based on the use of liquid salt. There are a number of reasons thorium-fueled reactors, in particular the thorium molten salt reactor (TMSR), would work for China. First, nuclear fission does not produce air pollution. Second, thorium, being a by-product of rare-earth mining, is believed to be far more abundant in China than uranium. Third, it could turn thorium, currently considered a waste-by-product in the processing of rare earth elements, into something of value.China's effort of developing a TMSR is part of a bigger program to develop both solid fueled and liquid fueled reactors.Cindy Hurst gives an overview of China's thinking in regard to thorium and the actions it is taking to develop the first thorium molten salt reactor. Read in full here.

China's vast coal reserves and system of hydroelectric dams, as well as eighty nuclear reactors currently under construction or planned, will enable it to provide for its electricity needs, albeit with some non-trivial environmental consequences. Transportation fuel is a completely different story in China, as it is everywhere else. All these cars, not to mention other modes of transport (ships, trains, and planes) require gigantic quantities of oil, and China is already the world's number one importer, with 60 percent of its oil needs coming from abroad—a level of dependency almost twice as high as America’s. Obtaining the crude will become an increasingly difficult task, considering the potential for economic growth China still harbors. This probably means that China will be ever more willing to compromise its "peaceful rise" policy in order to meet its energy security needs. Japan went to war against the United States in 1941 largely for fear of being starved of energy. Can we learn anything from that tragedy? Read more here.

As the military clash in Ukraine and the conflict between Russia and the West escalates, U.S. government top energy officials and leading experts on the South Caucasus energy and politics assembled at a Washington DC conference on “Security and Energy Implications for the South Caucasus after Ukraine.” The January 28th event was cosponsored by the Kennan Institute of the Wilson Center and the newly formed Center for Energy, Natural Resources, and Geopolitics (CENRG) at the Institute for the Analysis of Global Security.

Succumbing to populist pressure, the Israeli government today delivered a crippling blow to the country's ambition to become a regional energy player. With the decision of the Israeli Anti-Trust Authority to revoke an arrangement permitting Noble-Delek partners to develop the natural gas field Leviathan, declaring them a cartel - a move that will require the separation of Leviathan from Tamar and the sale of Leviathan to a new partnership, effectively postponing the development of Leviathan indefinitely - the scenario of “zero gas” - and perhaps even the withdrawal of Noble from Israel altogether - should be considered seriously. The implications are profound not only for Israel but for the entire region.

The recent slump in oil prices has sent gasoline prices below $3 a gallon, leading many Americans to believe that our energy predicament is a vestige of the past. Decades of anxiety over our dependency on Middle Eastern oil with all its economic and geopolitical trappings are giving way to a new era of complacency in our energy discourse. Such a euphoric mindset could lead to painful consequences down the road.

Energy supplies to Central and Eastern Europe, and especially the Balkans, have become a “football” in the worsening relations between Russia and the West – and the countries of the region. Natural gas, nuclear, and so forth: what is needed is dispassionate policy analysis taking into account both geopolitical and economic factors, which in this article Ariel Cohen attempts to provide.

The recent agreement between President Xi and President Obama in which the U.S. committed to reduce greenhouse gas emissions up to 28 percent below its 2005 levels while China committed to have its emissions levels peak by 2030 was one of the trumpeted announcements of the recent APEC Summit. The details on how this will exactly be done are fuzzy and will be left to negotiations in the United Nations Climate Change Conference in Paris next year. But the 2030 goal means that in the coming months China will be subjected to international pressure to turn words into deeds by accepting CO2 reduction measures which may be detrimental to its economic development. To this it should not agree.

When the Ukraine crisis broke out threatening to compromise Europe's energy supply from Russia, many American politicians and pundits called for the United States to expedite exports of liquefied natural gas, or LNG, to help bolster European energy security. Never mind that the United States won't have its first LNG export terminal in operation until late 2015 at the very earliest; that much of its approved gas exports are already committed to long-term contracts in Asia; and that Ukraine as well as most European countries under the Kremlin's boot do not have the terminals for receiving LNG. The United States is under no obligation to bolster Europe's energy security just because Europe, in its fixation on climate change, has for years undermined its own energy security and brought upon itself its current predicament. Gal Luft elaborates.

This week's meeting of Asia-Pacific energy ministers in Beijing is a good opportunity for countries on both sides of the Pacific to address perhaps the most unifying challenge in Asia: energy insecurity. For all their differences and historical grievances, Asian countries share the need to strengthen energy security while addressing the environmental challenges that come from fast-growing consumption. Asia's energy landscape today is a cluster of segregated markets. A change may be in order. Gal Luft elaborates.

It is easy to see why the recent Russia-China pipeline deal, encompassing some $400 billion of gas over 30 years, would make policymakers on both sides of the Atlantic cringe, especially since it comes just days before the G-7 leaders meet in Brussels to discuss how to isolate Russia. But while there are many reasons for the West to dislike the gas deal, it may not as bad as it seems. In fact, it may offer some unforeseen benefits – even for the United States. Gal Luft explains.

Lord Howell, a former British energy minister, argues that moves to diversify energy supply to reduce dependency on Russian gas are a mistake. In this Note he urges the British government and their European allies to see Russian gas as the most realistic option for long-term stable energy.

Lord Howell writes: "It is probably in everyone's interest, European and Russian, to see Russian alternative gas routes expanded (such as Southstream) which circumvent Ukraine, where there is bound to be continued trouble. But in the longer term Russian gas will prove to be far the most reliable and the cheapest gas source for Europe. Costly diversification, or hopefully waiting for American gas, will prove both pointless and ineffectual."

Rarely has the future of energy been more aggressively targeted by what many may consider some of the world’s most staid institutions. However with cooperation and support over the last decade from the World Bank and even NATO, the Sahara Wind Project is bringing much needed power to one of the neediest regions of the world. From its operating 380 MW wind power base, Morocco’s wind capacity will reach 800 MW by the end of 2014. Mauritania is also a partner and beneficiary country of this project that may hold the key for unlocking the human, and industrial, potential of this region of the world.

Russia has just written off 90 percent of North Korea’s debt in exchange for Pyongyang’s agreement to build a natural gas pipeline that would run from Russia through North Korea to South Korea, the world’s second largest gas importer. Indeed, while the U.S. invests a great deal of political capital on reducing Ukraine’s dependence on Gazprom, South Korea, its key ally in Asia might soon be heading in the opposite direction. Vladimir Putin has demonstrated how competent he is as a spoiler of U.S. foreign policy in Eastern Europe, the Middle East and Central Asia. Having his Gazprom meddling in the heart of the combustible Korean Peninsula is an idea which America should resist with all vigor.

China’s interest in the South China Sea and its potential sub-sea fossil fuel resources has implications for nations across the region and beyond. Answering when and how these interests may manifest themselves in concerted foreign policy actions exercised by China or other littoral states in the region is a major analytical objective of Part I of this two part article series focused on the nexus between natural resources and potential military action in the South China Sea neighborhood.

While Asia has quickly become a major magnet of global oil demand, less noticed have been Asian efforts to develop regional oil hubs. This article explores the challenges and benefits to Asia of developing significant oil storage capacity and the complexities of launching benchmarks (markers) against which regional trading and price adjustments can be made.

On March 26th, European leaders asked US President Obama to help in licensing the export of US derived shale gas to the continent. Such a request comes at a difficult time for all concerned. Tough and potentially costly decisions will have to be made in terms of directing America's natural gas to its best end-use. Gal Luft points out there has been an absence of significant discussion about how America's shale gas revolution can benefit one of the US economy's most important sectors-transportation.

A team of researchers lead by mathematician Dr. Rui Carvalho at the Centre for Mathematical Sciences, University of Cambridge, have come up with a model that demonstrates how Europe can bolster its natural gas resiliency through cooperation and access to each others’ energy markets. Natural gas pipelines, and moreover the networks they create, are expensive to build and even more so to operate if not utilized at or near capacity. Therefore these researchers set about the task of calculating how in times of conflict or crisis European economies could weather a major disruption in gas supplies without adding new capacity. The result was the publication this month of their research in a report entitled, “Resilience of natural gas networks during conflicts, crises and disruptions.”

Recent and ongoing security breaches at companies operating critical energy infrastructure have everyone concerned. There is a long way to go towards harmonizing and regularizing network security protocols across industries as Dr. Vincent Berk, CEO of FlowTraq a network security solutions provider, recently pointed out in an interview concerning cybersecurity with the Journal of Energy Security.

The Office of the Prime Minister of Israel has announced a competition for innovation in the fuels for transportation sector. The winner(s) of the competition will receive $US 1 million for global innovation, a scientific or a technological breakthrough in the field of competing fuels in transportation. Details follow.

Australian energy giant Woodside Petroleum which had previously agreed to buy a 30% stake in Israel's Leviathan gas field withdrew from the deal's signing ceremony at the last minute due to disagreements with the Israeli Tax Authority. What was likened to a bride escaping from her wedding prior to the "I do" moment, came as a shock to Israel's energy sector. Gal Luft analyzes.

One of the least explored but increasingly important areas of critical energy infrastructure protection concerns offshore oil and gas installations. The international regulatory framework provides a number of countervailing measures that can be used by states to protect offshore installations and respond to attacks and security incidents involving these installations. Mikhail Kashubsky who is with the Centre for Customs and Excise Studies in Australia explores the international regulatory aspects of offshore installations security in the second part of a three-part series for the Journal of Energy Security.

Whether it’s called ‘Green Energy’, ‘Smart Energy’, or ‘Operational Energy’ NATO Member and Partner States have learned a lot about the implications of rising power and energy demands in military operations and how emerging technologies can make the warfighter more effective and efficient. This complex endeavor ranges across a wide range of fields from battery technologies, electric vehicles, and improving the built environment for the solider just to mention a few working examples. This article discusses the role of the NATO Science and Technology Organization in leading this effort, what they are looking at today, in providing scientific and technological leadership for tomorrow.

Within the next six months, Algeria will be facing its next round of presidential elections. The stakes are high for incumbent President Abdelaziz Bouteflika and even higher for this hydrocarbon nation. The country's energy future is dominated by Sonatrach its national energy champion that has struggled in recent years to keep its oil and gas flowing at rates that can sustain economic growth, exports, and steadily increasing domestic demand for natural gas that powers Algeria's electricity grid. 2013 has not been kind to this North African country, surrounded by instabilities in Mali, Tunisia, Libya and further afield in Egypt. First there was the attack at the In Amenas gas facility that caused the international community to pause and ponder, however briefly, security in this vast state. But fundamental changes in energy markets are also challenging the country to develop its own significant reserves of shale gas, tight oil, and above all sunshine which if captured could secure Algeria's energy future for decades to come.

Turkmenistan, lead by its ever eager President Berdymukhamedov, forged ahead in October with its plans to put itself at the center of the energy security debate in Central Asia. It first hosted a meeting with the OSCE in the capitol city Ashgabat as another step to put itself front and center on security discussions within a UN context. Turkmenistan’s Deputy Prime Minister Rashid Meredov in September proposed not one but five meetings in 2014 to cover energy (and other issues like transport) explaining, “[energy security] is one of the most important components of stable world economy, its protection against distortions and disruptions," and further proposed the establishment of a new UN "universal international law tool kit" to form the legal basis for the international supplies of energy resources with a corresponding UN structure to enforce implementation of these provisions. Realistically the proposed efforts can also be seen as a flanking maneuver to ward off Russia’s ongoing influence in the republic and as a push-back to growing Chinese influence over its gas resources as contributor Anthony Rinna details in the following article.

When energy forecasters talk about future energy production and prices, people listen, especially if the modelers come from or represent vaunted organizations such as the International Energy Agency or the US Energy Information Administration. Although these are learned, serious people, relying on their long term forecasts - projections going out 10 or 20 years - is largely a mistake because they are almost always wrong, as suggested by a comparison of the Department of Energy’s 2005 forecasts to the actual outcomes. The piece offers explanations for why such forecasts are mistaken and explores the implications of society’s over-reliance on them.

Militarizing oil interests and assets is not something that oil companies openly attest or subscribe to based on their interests in maintaining their public, reputational value. However actions speak larger than words. The government of Ecuador has an interesting relationship with foreign oil companies as JES contributor Nicolai Due-Gundersen points out in his analysis of Iraq’s oil law and the potential inroads this law could provide to private military contractors (PMCs) in continuing their security activities in Iraq. In the meantime, Iraq has created an ‘oil police’ that Due-Gundersen maintains is the key to limiting the latitude of PMCs working in the Iraqi oil sector.

Vikram Rao’s Shale Gas: the Promise and the Peril provides a critical overview about the role of the United States’ vast shale gas resources in America’s overall energy mix. Rao concisely forges an ambitious, comprehensive analysis on what shale gas exploitation means for environmental stewardship, transportation, national security, jobs, and America’s geopolitical standing. Mark Donig reviews this recent and important book.

One of the least explored but increasingly important areas of critical energy infrastructure protection concerns offshore oil and gas installations. The threat environment encompasses potential attacks from terrorists and other disgruntled groups to sabotage carried out by employees of oil and gas companies themselves. Mikhail Kashubsky who is with the Centre for Customs and Excise Studies in Australia explores the threat environment for these installations in the first past of a three-part series for the Journal of Energy Security.

There is truth to the rumor that there is natural gas under the sea in the eastern Mediterranean. How much gas that can be commercially exploited is another matter altogether. Aside from the confusion that eastern Med-gas hyperbole engenders, is the animosity it contributes to already fractious relations among nations in the region. Cooperation not confrontation is what is needed to create reliable long-term markets for what exploitable natural gas can provide to the citizens and nations of this region as Sohbet Karbuz argues in this succinct analysis of the eastern Med-gas debate.

The future of natural gas in Europe is a conundrum. While natural gas demand is soaring in the US and across Asia, demand has actually declined in Europe. Will a turn-away from natural gas dampen the EU's appetite for modernizing its critical energy infrastructure? Is Europe turning to coal to displace gas in power generation and if so is the European Carbon Market actually contributing to this fuel switch? First time contributor to the Journal of Energy Security, Jozef Badida, examines Europe's gas future within this complex context.

America is facing an energy-security paradox. Our domestic oil production is on the rise; the cars that roll onto our roads are more efficient than ever, and net oil imports are at their lowest level since the days when President George Herbert Walker Bush lived in the White House. Yet none of this has reined in the price of gasoline. This runs counter to U.S. conventional wisdom over the past forty years, touted by every president since Richard Nixon. Read more of Gal Luft's article on the energy security paradox.

"The United States stands on the cusp of a global strategic advantage of huge significance. It is now within our grasp to cut the Gordian knot of energy policy, transforming our economic prospects in a fairly short period. Seizing this advantage does not require or depend on an esoteric technological breakthrough. It does not require allied assistance. It does not require a great deal of citizen sacrifice, discipline or patience. It does not require new taxes or convoluted cap-and-trade schemes. It merely requires that the Administration and the U.S. Congress get their collective head straight for once about a policy area in which politically ecumenical futility has been the norm for nearly forty years."

Videos

Videos

Arbitrage will be pursued (Iranian edition)

When something is subsidized, people use more of it....and smuggle/sell it elsewhere to ca...

Can the American Energy Revolution Survive a Deal with Iran?

There is no lack of voices warning against the dangerous implications of the nuclear agree...

The Federal Government’s Track Record on Cybersecurity and Critical Infrastructure

The Washington Post reports on a new report prepared for the Senate Homeland Security and ...

Fuel for Thought: The Importance of Thorium to China

Over the past few years China has launched efforts to develop the world's first commercial...

Grumbles in the Magic Kingdom

The Economist re Saudi Arabia: "[the Saudi] kingdom has sold the rest of the world arou...

New Books

"Remarkable collection spanning geopolitics, economy and technology. This timely and comprehensive volume is a one stop shop for anyone interested in one of the most important issues in international relations."U.S. Senator Richard G. Lugar

"A small masterpiece -- right on the money both strategically and technically, witty, far-sighted, and barbeques a number of sacred cows. Absolutely do not miss this." R. James Woolsey, Former CIA Director

"The book is going to become the Bible for everyone who is serious about energy and national security." Robert C. McFarlane, Former U.S. National Security Advisor